Embrace the content grind
PLUS: BuzzFeed waited too long to launch its own social media platform.
Welcome! I'm Simon Owens and this is my media industry newsletter. If you've received it, then you either subscribed or someone forwarded it to you.
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Embrace the content grind
This is a fascinating interview with a creator who's been regularly posting videos to the internet since before YouTube even existed. He talks about a nine-year period — stretching from around 2010 to 2019 — when his channel was stuck at around 50,000 subscribers and he struggled to eek out a living. And then one day he uploaded a video with a slightly modified format, and it took off, and that allowed him to return to steady growth.
That anecdote really captures what it's like to be a solo creator; every week you're just grinding it out while continuing to iterate on your content output, and for much of that time you have no idea if any of it's really working. You just have to kind of trust the process. That's why the biggest super power any creator can have is consistency.
YouTube built the perfect flywheel
YouTube just released its quarterly results, and its 2024 ad revenue alone was around $36 billion — not far off from Netflix's total annual revenue of $39 billion. And here's the kicker: that number doesn't even include the revenue generated by YouTube's 100 million paid subscribers.
And I think we're still in the early stages of its growth. Its revenue share with creators has produced such a perfect flywheel that it's going to become impossible for any Hollywood studio or social platform to compete with it for creative talent. As the revenue share gets larger, creators will plow more and more investment back into their own content production, which will then result in even more popular videos. The next David Chase or Vince Gilligan or Shonda Rhimes will probably launch their show on YouTube.
Tubi’s smart arbitration strategy
It seems like a smart strategy to me that Fox is streaming the Super Bowl on Tubi. It's only one game, so it doesn't cannibalize Fox's lucrative linear TV business, and it's the one game every year where people tune in just to watch the ads, so there's extra incentive to maximize visibility to an even greater audience.
I think Tubi overall has been really innovative in terms of offering free access to premium content. It doesn't waste much money on expensive originals, and it also doesn't bid for the most popular TV shows or movies. That's because it doesn't need to; people are willing to accept slightly lower quality when they don't have to pay for it. At the same time, its content library is still differentiated from free social platforms like YouTube. So in theory, it just needs to generate more in ad revenue than it's paying for content, which shouldn't be hard to do given that it's bidding on inexpensive shows and movies that the big paid streamers don't care about. It’s basically engaging in advertising arbitrage with discarded Hollywood IP.
An interesting outside-the-box monetization strategy
This is interesting. A YouTube creator who specializes in music commentary is launching his own physical recording studio where he'll help music artists produce and market their songs. He discloses that he's sunk $1.5 million into building out the studio.
I think what's smart about this strategy is that he's going to use the studio to record his own videos and music, so he'll be monetizing it in multiple ways while simultaneously using the reach of his YouTube channel to market the studio to potential customers. And given the high upfront investment required, it won't be easy for other music YouTubers to replicate his strategy.
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Twitch needs to copy its competitors
Twitch CEO Dan Clancy spoke to Fast Company about why Twitch remains the preferred platform for live streaming despite every other platform trying to copy it:
“If there’s a creator you watch on TikTok and they stopped posting content for two weeks, you probably wouldn’t even know. Whereas on Twitch, your affinity is with the creators that you have come to know. That’s one reason why creators that are focused on livestreaming prefer Twitch. People are showing up for them, not just to swipe.”
I think one of the problems facing Twitch is that so many competitors are moving in on its territory while it's not doing much to move into their territories.
I remember watching a video from a live streamer who broke down his revenue and watch times. While Twitch outperformed YouTube Live in both audience and monetization, YouTube produced a much larger on-demand audience — and ultimately drove way more revenue — after the live stream ended.
In other words Twitch is really great for live streaming, but it does virtually nothing to utilize its vast catalog of on-demand content, even though we know these passive audiences are huge. In fact, some of the most popular videos on YouTube are recorded Twitch streams!
Spotify reached escape velocity
As expected, Spotify announced its first full year of profitability:
Chief Executive Officer Daniel Ek has been pushing Spotify to expand beyond its dominant position in music streaming, adding audiobooks, podcasts and video, luring more paying subscribers despite two rounds of price increases in a little more than a year. Combined with eliminating some 1,500 jobs, that has helped deliver Spotify’s first full-year profit since it launched in 2008. The company reported net income of €1.14 billion ($1.2 billion) for all of 2024.
I think it's safe to say that Spotify has reached the escape velocity that will allow it to out-compete all the other music streamers for the foreseeable future. Its mixture of podcasts, music, and audiobooks gives it an incredible level of differentiation from, say, Amazon Music or Apple Music, and it's now reached sufficient scale with its free content to be taken seriously by advertisers. It's a true flywheel business now.
IP won’t save the media conglomerates
Bain published a research report arguing that the Hollywood studios and media conglomerates can compete with the big tech companies by doubling down on IP ownership:
That means that these companies are now converging to compete with giant tech players and buying “more evergreen IP” that can be used across platforms. “By owning these cross-sector assets and IP, they create fan communities and multimodal content — and they generate revenue not just from subscriptions, streaming ads, or theater tickets but also through other means, such as merchandise and special events,” the Bain report emphasizes.
I agree with the notion that IP ownership is the key differentiator for any media company, especially if it's evergreen IP, but what this analysis fails to recognize is that the big tech companies have driven up the price of IP ownership by bidding on it themselves. As long as Apple and Amazon can subsidize their media arms with their other businesses, traditional Hollywood studios will continue to have an uphill battle in acquiring the best shows and movies.
ICYMI: How a kids-focused podcaster reached 1 million monthly downloads
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BuzzFeed waited too long to launch its own social media platform
Original reporting almost always beats out news curation
Let’s jump into it…
BuzzFeed waited too long to launch its own social media platform
Semafor reports that BuzzFeed CEO Jonah Peretti wants to build out a social media platform that would give it more direct ownership of its audience: